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| A K Bhattacharya: When politics rules the roost | | Politicians have failed to understand the importance of supporting or opposing a proposal on the strength of its merit |
| A K Bhattacharya / New Delhi Nov 30, 2011, 00:19 IST |
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It is an irony that few will fail to notice. One of the main charges against the United Progressive Alliance (UPA) government in its second term was that it suffered from policy paralysis. A series of corruption scandals hit the UPA government, but its political leadership failed to respond to them with adequate measures. Worse, it lost appetite for economic reforms.
Things changed in the last few weeks. The government, it seemed, got its act together. The Union Cabinet approved a Bill allowing foreign direct investment (FDI) in the pensions sector and giving its regulator statutory status. Also approved were Bills for introducing a new companies law and a legal framework for land acquisition for projects and rehabilitation of displaced people. And then there was the Cabinet decision to allow 51 per cent foreign equity in multi-brand retail and all hell broke loose.
Make no mistake about why no one said a word when foreign investment was proposed in the pensions sector. That was simply because the Opposition political parties knew that it was a legislative change and the UPA government would have to cross many more hurdles before foreign investment in the pensions sector could become a reality. So, why spend your energy on such a move?
However, the Cabinet decision to allow FDI in retail will take effect once the government issues a notification. The government will not be required to go through a long and arduous legislative path before it becomes policy. That is why the Opposition parties raised a hue and cry over FDI in retail. But the irony of it all was that until the other day, the same Opposition political parties were accusing the UPA government of inaction and lethargy over taking policy decisions.
The Opposition political parties’ opportunism was on full display in another way. The retail sector is largely regulated by the state governments. Every retail company has to obtain a host of approvals from the state governments before it can start operations. The same approvals will be mandatory for any retail company with foreign equity. Theoretically, therefore, a state government that does not wish to have a foreign multinational giant operate in the retail sector can simply choose to deny the retail company one of those many permissions needed to start its business. So, why are the Opposition political parties at the helm of states across the country making a big issue out of the UPA government’s decision on FDI in retail? Once again, it is pure politics and political opportunism that are driving this opposition.
The UPA government, too, cannot escape from the charge that it had underestimated the political reaction its decision on opening the retail sector to FDI would trigger. Worse, its political immaturity in handling such a crisis was in evidence when it announced to hold a meeting with all political parties to discuss their views on FDI in retail. If the UPA government had to discuss such issues with the Opposition political parties, such a meeting should have been convened before the decision.
Consider what the V P Singh government did in 1990, before it had to take a tough decision on imposing a 25 per cent surcharge on petroleum product prices in the wake of the Gulf war jacking up international crude oil prices. The Opposition political parties attending that meeting more than 20 years ago did not agree to the Gulf surcharge move initiated by the V P Singh government. But the government then could argue that it did consult the Opposition before taking the decision.
If the UPA government had to consult the Opposition on the question of FDI in retail, it should have done so before its Cabinet met and approved the policy. Holding a meeting after the decision has been taken is a sign of weakness, which the Opposition political parties exploited quite well.
If you thought that it is only the Opposition political parties like the Bharatiya Janata Party (BJP) that indulge in such political opportunism, think again. All political parties behave in a similar fashion when they are not part of the government. Remember that the Congress failed to bail out the BJP-led National Democratic Alliance (NDA) government on the question of approving the Bill allowing FDI in the insurance sector. The same Congress, when it was in opposition, had mooted the idea of parliamentary approval of all proposals for disinvestment of government equity in public sector enterprises, so that the NDA government could be stopped from proceeding on disinvestment.
The point here is that even after 64 years of parliamentary democracy, India’s political parties have failed to understand the importance of supporting or opposing a proposal on the strength of its merit. They continue to be driven by the herd mentality that an Opposition political party’s job is to oppose everything that the ruling party proposes, irrespective of whether it is in the interests of the people of the country they represent. It is this bigoted belief that allows politics to snuff out the logic of governance and economic reforms.
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